Tony & Wally Pty Ltd (Migration)

Tony & Wally Pty Ltd (Migration) [2021] AATA 3489 (8 September 2021)
DECISION RECORD
DIVISION:Migration & Refugee Division
APPLICANT:  Tony & Wally Pty Ltd
CASE NUMBER:  1837179
HOME AFFAIRS REFERENCE(S):          BCC2017/1776532
MEMBER:Karen McNamara
DATE:8 September 2021
PLACE OF DECISION:  Sydney
DECISION:The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.

Statement made on 08 September 2021 at 1:05pm
CATCHWORDS
MIGRATION – application for approval of nomination of position – direct entry nomination stream – tasks of position – combined hearing with nominee’s application – written submissions and oral evidence from director of applicant and nominee – comparison of tasks and ANZSCO description – roles of director and manager in franchise – director’s other businesses and nominee’s autonomy – employed for 4 years already – decision under review set aside
LEGISLATION
Migration Regulations 1994 (Cth), r 5.19(4)(h)(ii)(D)
CASES
Cargo First Pty Ltd v MIBP [2015] FCCA 2091
Kartar Investments Pty Ltd v MICMSMA [2020] FCCA 5
Vishvam Pty Ltd as Trustee for the Vishvam Unit Trust v MICMSMA [2021] FCCA 758
STATEMENT OF DECISION AND REASONS
APPLICATION FOR REVIEW

This is an application for review of a decision made by a delegate of the Minister for Home Affairs on 12 December 2018 to reject the application by Tony & Wally Pty Ltd (the applicant) for approval of the nomination of a position in Australia under reg 5.19 of the Migration Regulations 1994 (Cth) (the Regulations).
The applicant applied for approval on 18 May 2017. The requirements for the approval of the nomination of a position in Australia are found in reg 5.19 of the Regulations which contains two alternative streams: a Temporary Residence Transition nomination stream (reg 5.19(3)) and a Direct Entry nomination stream (reg 5.19(4)). If the application is made in accordance with reg 5.19(2) and meets the requirements of either stream, then the application must be approved. If any of the requirements are not met then the application must be refused: reg 5.19(5).
In this case, the applicant has applied for approval of a nomination, seeking to satisfy the criteria in the Direct Entry nomination stream.
The delegate refused the application on the basis the nomination did not satisfy r.5.19(4)(h)(ii)(D) of the Regulations because the application did not demonstrate that the tasks to be performed in the position correspond to the tasks of the nominated position of Retail Manager.
The applicant applied to the Tribunal on 18 December 2018 for review of the delegate’s decision. The applicant submitted a copy of the primary decision record with the review application.
On 26 August 2021, the applicant represented by Mr Yin Zhao (referred to below as the applicant) appeared before the Tribunal via telephone, to give evidence and present arguments. The Tribunal also received oral evidence from Mr He Li (the nominee) in the related matter for the subclass 187 visa (AAT Case file 1902526). The related matters were heard concurrently in a combined hearing.
The Tribunal exercised its discretion to hold the hearing by telephone. The hearing was held during the COVID-19 pandemic. The Tribunal determined it was reasonable to hold a hearing by telephone, having regard to the nature of this matter and the individual circumstances of the applicant and nominee. The Tribunal also had regard to the Tribunal’s objective of providing a mechanism of review that is fair, just, economical and quick, and the delay to the matter if the hearing was not to be conducted by telephone. The Tribunal is satisfied that the applicant and nominee were given a fair opportunity to give evidence and present arguments.
On 31 August, 2 and 3 September 2021, the Tribunal received submissions from the applicant addressing matters raised by the Tribunal during the hearing of 26 August 2021.
The applicant was represented in relation to the review. The representative attended the Tribunal hearing.
For the following reasons, the Tribunal has decided to set aside the decision under review and substitute a decision approving the nomination.
CONSIDERATION OF CLAIMS AND EVIDENCE
The issue in this case is whether the applicant meets the requirements for approval of the nomination under the Direct Entry nomination stream set out in reg 5.19(4), which is extracted in the attachment to this decision. For the nomination to be approved, all the requirements must be met.
Background
The applicant owns and operates an auto mechanic service trading as Ultra Tune Townsville City. The business operates under a franchise agreement and was registered on 11 September 2014.
On 18 May 2017, the applicant lodged an application for an employer nomination approval for the position of Shop Manager under the occupation Retail Manager (General) (ANZSCO 142111) under the Regional Sponsored Migration Direct Entry stream. The position is located at Townsville, North Queensland. The nominated base rate salary is $47,000 and guaranteed earnings is $51,465 per annum.
The Tribunal notes that numerous evidence and submissions were lodged by or on behalf of the applicant. While the Tribunal has considered all of same, only that which was considered material to its decision has been expressly referred to herein.
The application is compliant: reg 5.19(4)(a)
Regulation 5.19(4)(a) requires that the application for approval must be in the approved form, must be accompanied by the prescribed fee, and, where applicable, must include the required written certification relating to conduct that contravenes s 245AR(1). The application must also identify a need for the nominator to employ a paid employee to work in the position under their direct control.
Based on the material in the Department’s file, the Tribunal is satisfied that the application was made on the approved form. As the position is located in regional Australia, no fee is payable (r5.37(2)(a)). The application also included written certification relating to conduct that contravenes s.245AR(1) of the Migration Act 1958, declared and signed by the applicant. Accordingly, the requirements of r.5.19(4)(a)(i) are met.
In considering whether the application for approval identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control, the Tribunal has had regard to the evidence before it, including written submissions and the oral evidence received at the hearing by Mr Yin Zhao. In support of the need for the position, the applicant has provided evidence in the form of written statements to the Department dated 30 May 2017 and 10 October 2018 and oral evidence provided at the hearing on 26 August 2021.
The applicant told the Tribunal, the position of Store Manager existed in the organisational structure prior to his purchase of the business. The need to employ a paid employee to work in the nominated position arose when the business sought to operate with two managers to cover extended opening times. A previous manager due to a personal problem, was not suitable to continue in the role and since purchasing the business the applicant has had three people undertaking the tasks and responsibilities of the position. The nominee was recruited to the position by a former manager (Wally) who relocated to Brisbane. The business now operates with one Store Manager, the position occupied by the nominee.
Accordingly, the requirements in r5.19(4)(a)(ii) are met.
As the criteria in both r.5.19(4)(a)(i) and (ii) are satisfied, accordingly the requirements in r.5.19(4)(a) are met.
Nominator is actively and lawfully operating a business in Australia: reg 5.19(4)(b)
Regulation 5.19(4)(b) requires that the applicant is actively, lawfully and directly operating a business in Australia.
The Tribunal accepts on the evidence before it that the applicant operates an Ultra Tune franchise located at Townsville, Queensland. Based on the material provided to the Tribunal, (including financial statements, BAS returns, ASIC details, franchise agreement, business insurance details, supplier invoices and bank account statements) the Tribunal is satisfied the applicant is actively and lawfully operating a business providing automotive mechanic services in Australia and directly operates that business.
Accordingly, the requirement in r.5.19(4)(b) is met.
Position is not labour-hire: reg 5.19(4)(c)
Regulation 5.19(4)(c) applies to nominators whose business activities include those relating to labour hire to an unrelated business. In these cases, the nominated position must be within the business activities of the nominator.
There is no evidence before the Tribunal to suggest that the applicant’s business is involved in labour hire.
Accordingly, the requirement in r.5.19(4)(c) does not apply.
Term of employment of the visa holder: reg 5.19(4)(d)
Regulation 5.19(4)(d) requires the nominee to be employed in the nominated position for at least 2 years full time, and the terms and conditions of that employment do not expressly exclude the possibility of an extension.
In considering whether the business has the financial capacity to pay the nominee, the nominated full time salary of $47,000 per annum for at least two years, the Tribunal has taken into consideration evidence before it including the applicant’s most recent financial statements, documents submitted to the ATO and information which show the applicant has met payroll and operating costs for the last two years.
The Tribunal examined the financial information submitted by the applicant and notes that the applicant’s 2020/21 financial statements show that the business for the 2020/21 financial year reported income of $1,043,474, with net profit of $67,077. Due to accumulated losses carried over from the previous financial year, the business recorded an accumulated loss of ($136,104). The applicant told the Tribunal that the accumulated loss was attributable to an increase in wages expenses in 2019/20 coupled with a reduction in sales revenue due to COVID restrictions. In 2020/21 financial year the applicant states that the business paid overdue debt, including aged rent, overdue franchise commission and cleared all 60 days and 90 days accounts payable to suppliers. After clearing all debt and overdue payments, the business realised a net profit of $67,077. Whilst the business recorded an accumulated loss, the Tribunal notes that the business recorded cash assets of $153,783 with bank statements recording as of 21 May 2021 a balance of $129,838.
At the hearing the Tribunal discussed with the applicant the impact of the COVID -19 pandemic on the business. The applicant told the Tribunal that whilst forced closures had an impact on revenue, turnover has remained consistent and is starting to return at a higher level to pre Covid reported revenue. The business was able to retain its employee’s during Covid-19 with the assistance of Job keeper payments, whilst the nominee was not entitled to Job Keeper payments the applicant continued to meet the nominee’s salary.
In undertaking its assessment that the employee will be employed on a full-time basis in the position for at least 2 years the Tribunal has also taken into consideration the nominee has been employed by the applicant since March 2017. The applicant and nominee’s bank account statements and PAYG’s support the nominee has received regular salary payments in excess of the nominated salary amount and employer superannuation contributions have been paid.
The Tribunal has afforded consideration to the financial evidence before it and is satisfied on balance that the applicant has the financial capacity to pay the nominee a full-time salary of $47,000 per annum and maintain the employment of the nominee on a full-time basis for two years.
Accordingly, the requirement in r.5.19(4)(d)(i) is met.
The Tribunal has had regard to the nominee’s most recent contract of employment signed and dated 10 March 2017. The contract, which sets out the terms and conditions of employment, indicate that the period of employment is ongoing. The contract stipulates the salary is $55,328 per annum exclusive of superannuation with hours of work 38 hours per week. There is no term excluding an extension of the contract.
The Tribunal is satisfied based on the employment contract dated 10 March 2017 and other material before it, that the nominee will be employed on a full-time basis for at least two years on terms that do not exclude the possibility of extending the period of employment. Accordingly, the requirement in r.5.19(4) (d) (ii) is met.
As the criteria in both r.5.19(4)(d)(i) and (ii) are satisfied, accordingly the requirements in r.5.19(4)(d) are met.
No less favourable terms and conditions of employment: reg 5.19(4)(e)
Regulation 5.19(4)(e) requires that the terms and conditions of employment applicable to the nominated position will be no less favourable than those that are, or would be, provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
The contract of employment dated 10 March 2017 sets out the terms and conditions of employment and indicates that the nominee’s salary will be $28 per hour for the number of hours worked. The full-time equivalent salary is $55,328 per annum based on 38 hours per week. The nominee’s leave entitlements include annual, sick, parental and long service leave.
The Tribunal has received copies of the nominee’s PAYG’s and bank statements confirming that the nominee has been paid by the applicant in excess of the nominated salary amount of $47,000 per annum. Superannuation information provided to the Tribunal, support that the nominee is being paid superannuation. The Tribunal is therefore satisfied based on the evidence before it that the nominee will be paid in accordance with the terms of employment. The Tribunal has also been provided copies of other employee’s employment contracts and notes similar terms and conditions as provided to the nominee.
The Tribunal is therefore satisfied on the totality of the evidence before it that the terms and conditions applicable to the position will be no less favourable than those that would be provided to an Australian citizen or permanent resident performing equivalent work in the same workplace at the same location.
Accordingly, the requirements of r.5.19(4)(e) are met.
No adverse information known to Immigration: reg 5.19(4)(f)
Regulation 5.19(4)(f) requires that there is no adverse information known to Immigration about the nominator or person associated with the nominator; or it is reasonable to disregard any such information. For these purposes, ‘adverse information’ and ‘associated with’ have the meaning given in regs 1.13A and 1.13B.
There is no evidence before the Tribunal to indicate that there is adverse information as per the meaning given in rr.1.13A and 1.13B, known to the Department about the applicant or an associated person.
Accordingly, the requirements of r.5.19(4)(f) are met.
Satisfactory compliance with workplace relations laws: reg 5.19(4)(g)
Regulation 5.19(4)(g) requires that the applicant has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations.
There is no evidence before the Tribunal that indicates the applicant does not have a satisfactory record of compliance with the relevant Commonwealth and State workplace relations laws.
Accordingly, the requirements of r.5.19(4)(g) are met.
Tasks of the position, genuine need for the position and training requirements reg 5.19(4)(h)
Regulation 5.19(4)(h) contains a number of alternative requirements. These are set out in detail in the attachment to the decision but can be briefly summarised as requiring either that:
·the tasks to be performed in the position will be performed in Australia and correspond to those of an occupation specified by the Minister in the relevant instrument, the occupation is applicable to the proposed employee in accordance with any specifications made in that instrument, and specified training requirements are met; or
·the position and nominator’s business is located in regional Australia, there is a genuine need for the paid position under the nominator’s direct control which cannot be filled by a locally resident Australian citizen or permanent resident, the tasks of the position correspond to those of an occupation specified in the relevant legislative instrument, the occupation is applicable to the proposed employee in accordance with the specification of the occupation and that a regional certifying body has advised the Minister about certain matters relating to the position.
In this case, the applicant claims to meet the requirements in r.5.19(4)(h)(ii). The Tribunal has considered each of these requirements as follows;
The evidence before the Tribunal indicates that the applicant’s business, which is operated by the applicant and the position are located in Townsville, Queensland, postcode 4810 which is a postcode specified in the relevant instrument as being in regional Australia, accordingly r.5.19(4)(h)(ii)(A) and (E) are met.
The Tribunal next considered whether there is a genuine need for the applicant to employ a Shop Manager under the occupation of Retail Manager (General) (ANZSCO 142111) and for the tasks of that position.
In considering whether there is a genuine need for the nominator to employ the nominee as a paid employee, to work in the position under the nominator’s direct control, the Tribunal has had regard to the evidence before it, including written statements and the oral evidence received at the hearing by Mr Yin Zhao.
The applicant gave evidence at the hearing that the position is key to the operational requirements of the business, in so far as the position of Shop Manager is consistent with the nature of operating an Ultra Tune automotive mechanical service business.
The genuine need to employ the nominee in the nominated position has arisen as a result of the difficulties the applicant has had in filling the position on a full-time basis. The applicant told the Tribunal that he has employed three people prior to the nominee, to cover the tasks of the position. One due to a personal problem was not suited to the role and the other two resigned.
The Tribunal is satisfied on the evidence presented by the applicant that there is a genuine need for a paid employee to work in the position of Shop Manager under the occupation of Retail Manager (General) (ANZSCO 1421111) under the nominator’s control. Accordingly, the requirement of r.5.19(4)(h)(ii) (B) is met.
The Tribunal is satisfied that the material and evidence provided by the applicant, supports the applicant’s claims that they have made efforts to fill the position locally by an Australian citizen or an Australian permanent resident. The applicant provided evidence that they have been unsuccessful in sourcing an experienced and qualified Australian citizen or an Australian permanent resident to the position. The Tribunal also gives weight to the RCB’s advice that the position cannot be filled locally.
On the evidence before it, the Tribunal is satisfied that the position cannot be filled by an Australian citizen/permanent resident living in the same local area. Accordingly, the requirements of r.5.19(4)(h)(ii)(C) are met.
The delegate refused the application on the basis the applicant’s nomination did not satisfy r.5.19(4)(h)(ii)(D) of the Regulations. The delegate formed the view that the tasks to be performed in the position did not correspond to the tasks of a Retail Manager (General) as specified by the Minister in an instrument in writing for sub-subparagraph 5.19(4)(h)(ii)(D).
The Tribunal has formed a different view and accepts the evidence presented by the applicant and nominee attesting to the tasks and duties of the position.

The Tribunal notes that a more comprehensive suite of evidence was presented to it than was given to the delegate in the original application. The Tribunal has had the opportunity to discuss with the applicant and the nominee at the hearing, the precise tasks and responsibilities of the nominated position and how these tasks align with the nominated occupation under ANZSCO.
For nominations made on or after 1 July 2015, regulation 5.19(4)(h)(ii)(D) requires the tasks to be performed in the position correspond to the tasks of an occupation specified in an instrument.[1] This requires a qualitative analysis of whether the position is what it really purports to be in a practical sense, which is more than a line by line comparison of the tasks for example in the employment contract and the tasks of ANZSCO description.[2] It is a question of fact and the weight the decision maker gives to various considerations and evidence is a matter for it.[3]
[1] reg 5.19(4)(h)(ii)(D) as amended by SLI 2015, No 103.
[2] Vishvam Pty Ltd as Trustee for the Vishvam Unit Trust v MICMSMA [2021] FCCA 758 at [34]–[37]. The Court accepted that the qualitative analysis required for reg 2.72(10)(f) (whether the position associated with the nominated occupation is genuine) endorsed in Cargo First Pty Ltd v MIBP [2015] FCCA 2091 was applicable to reg 5.19(4)(h)(ii)(D) assessment of whether the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument.
[3] In Kartar Investments Pty Ltd v MICMSMA [2020] FCCA 5, the Court found that it was open for the Tribunal to consider not only the documentary material but the oral evidence at hearing concerning the nominee’s role, and the Tribunal was not bound to treat the description in the contract as definitive but was open to take preference for one evidence over another (at [66]-[69]).
In their decision of 12 December 2018, the delegate noted the following;
‘…….Policy further states: “Under a franchise arrangement, the franchisee may
use a product, trade mark, trade name or confidential information that is legally owned by
the franchisor…”. Therefore, In light of the operations of the business under a Franchise
structure, as outlined in Policy, it is reasonable to expect that the role and tasks of a Retail
Manager (General) (ANZSCO: 142111) would be fulfilled by the Franchisee, who in this
instance is Tony Shan and not the nominee.
I have taken into account the information submitted with the application. However,
considering the evidence overall, I am of the view that the predominant tasks of the position
are not those of an ANZSCO Skill Level 2 Retail Manager..’
The representative in their submission dated 12 November 2020 provided a comprehensive assessment of the applicant’s autonomy to delegate management responsibility under the franchise agreement. In summary the representative concluded that there is nothing in the franchise documentation that states that the Director and/or owner of the franchise business must personally manage the business.
The Tribunal discussed with the applicant the delegate’s comments and reason for the nomination refusal. The applicant told the Tribunal that whilst he is the business owner, he is reliant upon the nominee to manage the operations of the Ultra Tune business as the applicant is responsible for the direct management of three other business including two Coffee Clubs. Furthermore, he is currently enrolled in a Graduate Diploma of Migration Law and Practice at the University of Technology and does not reside in the Townsville region.
The applicant told the Tribunal that the nominee has autonomy for the management of the operations of the Ultra Tune business which includes but not limited to the day to day management of the staff, sourcing and organising stock, marketing and promotional activities, providing financial reports and ensuring the business complies with OH&S etc.
In support of the management responsibilities undertaken by the nominee, the applicant has additionally provided evidence supporting the nominee’s management responsibilities including references from suppliers, internal correspondence and marketing and promotional activities managed by the nominee.
The Tribunal has afforded careful consideration to the evidence before it and has discussed with the applicant and nominee at the hearing the precise tasks and responsibilities of the nominated position and how these tasks align with the nominated occupation under ANZSCO. In undertaking its assessment as to whether the tasks to be performed in the position correspond to the tasks of an occupation specified in an instrument, the Tribunal has also afforded consideration to the environment in which the business operates, the size of the applicant’s business and operational requirements and how the tasks of a Retail Manager (General) (as undertaken in the nominated position) are relevant to meeting these requirements.
Having afforded consideration to the evidence before it, the Tribunal is therefore satisfied that the tasks to be performed in the position, correspond to the tasks of a Retail Manager (General) ANZSCO 142111. Accordingly, the requirements of r.5.19(4)(h)(ii)(D) are met.
Department records show that the nominee whilst studying in Australia, attained a Bachelor of Business Degree from James Cook University in March 2016. The nominee has been employed by the applicant in the position of Shop Manager since March 2017.
Having considered the evidence attesting to the nominee’s experience and qualifications the Tribunal is satisfied that he is suitably qualified for the position and that the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation. Accordingly, the requirements of r.5.19(4)(h)(ii) (DA) are met.
The Tribunal notes the advice dated 10 April 2017 from the relevant RCB, Chamber of Commerce and Industry Queensland, indicating that they are satisfied regarding the matters specified in r.5.19(4)(e) and r.5.19(4)(h)(ii)(B) & (C). On this basis, the Tribunal is satisfied that r.5.19(4)(h)(ii)(F) is met.
Accordingly, the requirements of r.5.19(4)(h) are met.
Based on the findings above, the Tribunal is satisfied that the applicant meets the requirements of r.5.19 for approval of the nomination of the position in Australia.
DECISION
The Tribunal sets aside the decision under review and substitutes a decision approving the nomination.
Karen McNamara
Member

ATTACHMENT - EXTRACTS FROM THE MIGRATION REGULATIONS 1994
5.19Approval of nominated positions (employer nomination)
…
(2)The application must:
(a)be made in accordance with approved form 1395…; and
(aa) include a written certification by the nominator stating whether or not the nominator has engaged in conduct, in relation to the nomination, that constitutes a contravention of subsection 245AR(1) of the Act; and
(b)be accompanied by the fee mentioned in regulation 5.37.
…
Direct Entry nomination
(4)The Minister must, in writing, approve a nomination if:
(a)the application for approval:
(i)       is made in accordance with subregulation (2); and
(ii)      identifies a need for the nominator to employ a paid employee to work in the position under the nominator’s direct control; and
(b)the nominator:
(i)       is actively and lawfully operating a business in Australia; and
(ii)      directly operates the business; and
(c)for a nominator whose business activities include activities relating to the hiring of labour to other unrelated businesses — the position is within the business activities of the nominator and not for hire to other unrelated businesses; and
(d)both of the following apply:
(i)       the employee will be employed on a full-time basis in the position for at least 2 years;
(ii)      the terms and conditions of the employee’s employment will not include an express exclusion of the possibility of extending the period of employment; and
(e)the terms and conditions of employment applicable to the position will be no less favourable than the terms and conditions that:
(i)       are provided; or
(ii)      would be provided;
to an Australian citizen or an Australian permanent resident for performing equivalent work in the same workplace at the same location; and
(f)either:
(i)       there is no adverse information known to Immigration about the nominator or a person associated with the nominator; or
(ii)      it is reasonable to disregard any adverse information known to Immigration about the nominator or a person associated with the nominator; and
(g)the nominator has a satisfactory record of compliance with the laws of the Commonwealth, and of each State or Territory in which the applicant operates a business and employs employees in the business, relating to workplace relations; and
(h)either:
(i)       both of the following apply:
(A)the tasks to be performed in the position will be performed in Australia and correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(AAA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(B)either:
(I)the nominator’s business has operated for at least 12 months, and the nominator meets the requirements for the training of Australian citizens and Australian permanent residents that are specified by the Minister in an instrument in writing for this sub-sub-subparagraph; or
(II)the nominator’s business has operated for less than 12 months, and the nominator has an auditable plan for meeting the requirements specified in the instrument mentioned in sub-sub-subparagraph (I); or
(ii)      all of the following apply:
(A)the position is located in regional Australia;
(B)there is a genuine need for the nominator to employ a paid employee to work in the position under the nominator’s direct control;
(C)the position cannot be filled by an Australian citizen or an Australian permanent resident who is living in the same local area as that place;
(D)the tasks to be performed in the position correspond to the tasks of an occupation specified by the Minister in an instrument in writing for this sub-subparagraph;
(DA)the occupation is applicable to the person identified under subparagraph (a)(ii) in accordance with the specification of the occupation;
(E)the business operated by the nominator is located at that place;
(F)a body that is:
(I)specified by the Minister in an instrument in writing for this sub-subparagraph; and
(II)located in the same State or Territory as the location of the position;
has advised the Minister about the matters mentioned in paragraph (e) and sub-subparagraphs (B) and (C).

[2021] AATA 3489

8 September 2021

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Immigration

Administrative Law

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Judicial Review

Statutory Construction

Procedural Fairness

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